SEBI, in its administrative warning said Ola Electric by breaching disclosure norms, has failed to give equal, timely and cost-efficient access to information for all its investors
Securities and exchange board of India (Sebi) has warned Ola Electric’s CEO Bhavish Aggarwal regarding violation of disclosure norms via an email on Tuesday. The regulator’s move has come after the EV maker’s CEO announced his business plan in a post on social media platform X before disclosing such information on exchanges.
In its administrative warning, the regulator said the company, by doing so, has failed to give equal, timely and cost-efficient access to information for all its investors. Sebi also in the same email, advised the EV maker to practice caution in the future and abide by compliance standards.
“It is observed that the information was disseminated on the stock exchanges by you at 1:36 PM (BSE) and 1:41 PM (NSE) on December 2, 2024, it was announced beforehand on X at 9:58 on December 2, 2024 by Bhavish Aggarwal, your promoter and CMD,” said the SEBI in a statement. “...by failing to first disseminate the information on the stock exchanges and instead announcing it on a social media platform, you have failed to provide equal and timely access to information for all investors,” the regulator added.
Sebi was referring to the announcement made by the company to expand its distribution network to 4,000 stores in December to boost business growth and EV adoption. The same information was already revealed by Aggarwal on X.
Aggarwal’s move breached rules 4 (1) (d), 4 (1) (f), 4 (1) (h) and 30 (6) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
This isn’t the first time the company has found itself in troubled waters since it got listed on the exchanges last year. The EV maker has also been on the radar of the consumer protection authority. The Central Consumer Protection Authority (CCPA) had issued a show cause notice to Ola Electrics in October last year for alleged violation of consumer rights, misleading advertisement and unfair trade practices.
Recently, the Karnataka High Court has given relief to the EV maker by giving an additional six weeks' time to submit documents and information sought by CCPA.
“We wish to inform you that the Hon’ble Karnataka High Court has granted an extension of six weeks for the Company to submit the response in respect of seeking additional documents and information by the CCPA,” the company said in a statement on January 7.